E262: 📦B2B Commerce Corner #18 | DRIVING B2B ECOMMERCE SUCCESS IN HEAVILY REGULATED MARKETS - DENNIS MISTRIOTY, BATCH

Building a Thriving CBD Business: Insights from Batch CEO Dennis Mistrioty

The CBD industry has seen astronomical growth in recent years, with numerous companies vying for a piece of the lucrative pie. Among these enterprises is Batch, a remarkable business that has carved out its niche by manufacturing, wholesaling, and distributing hemp and CBD products. At the helm of Batch is co-founder and CEO Dennis Mistrioty, whose entrepreneurial journey is as instructive as it is inspiring.

In this deep dive, we explore the multifaceted approach of Batch, the challenges of operating in a highly regulated sector, and the wisdom Dennis imparts on building businesses with a purpose.

From College Conversations to Cannabis Connoisseurs

Batch's story began at the University of Wisconsin-Madison, where Dennis and his two college roommates dreamed big about starting a business together. Their first venture into entrepreneurship was a Greek food truck on campus, which laid the groundwork for their future endeavors.

Fast forward to 2018, when industrial hemp became legal nationwide, Dennis and his team saw an opportunity in the burgeoning CBD market. Leveraging their passion for natural remedies and alternative medicine, they ventured into the cannabis industry, learning everything from scratch.

Embracing Regulatory Challenges in eCommerce

Operating in the CBD space comes with its own set of challenges, mainly due to the stringent regulations surrounding hemp and cannabis products. Dennis's experience in this domain echoes the struggles many eCommerce merchants face as they navigate the complexities of selling supplements, alcohol, or cannabis.

For Dennis, compliance and education are key. He emphasizes the importance of being transparent and authentic, allowing customers to trace Batch's products from the farm to their doorsteps.

The Power of Origin Stories in Branding

Batch's success is not only rooted in its high-quality products but also in the compelling origin story that resonates with customers. Dennis points out that many online businesses lose the human touch, which can result in a lack of customer trust and loyalty.

By weaving their origin story into the fabric of their brand, Batch creates an emotional connection with customers, something that Dennis believes is crucial for differentiation and community building.

Finding the Balance: D2C and B2B Approaches

Initially, Batch leaned heavily on B2B sales, manufacturing products not only under their own label but also for other CBD companies. However, they quickly realized the benefits of direct-to-consumer (D2C) sales. Now, D2C represents over 90% of Batch's revenue, with a significant portion still coming from contract manufacturing.

Dennis highlights the importance of a multifaceted approach, acknowledging that wholesale partnerships can bring invaluable knowledge and opportunities for growth.

Leveraging Technology for Operational Excellence

At the core of Batch's operations is a suite of technologies that ensures efficiency and compliance. Data Ninja, a software that manages inventory and batch tracking, is crucial to their good manufacturing practices. Additionally, QuickBooks and ShipStation integrate seamlessly with their systems, enabling Batch to maintain control over inventory, fulfillment, and financials.

The Entrepreneurial Ethos: Collaboration Over Competition

Dennis's entrepreneurial philosophy revolves around generosity and openness. He shares that the most valuable returns often come from helping others without expecting anything in return. By fostering a spirit of collaboration, he believes businesses can achieve more than by fiercely competing against each other.

Conclusion

Dennis Mistrioty's journey with Batch is a testament to the power of passion, transparency, and strategic business planning. By embracing the challenges of a highly regulated industry and leveraging the strength of their origin story, Batch has become a leader in the CBD market. Dennis's insights provide a blueprint for entrepreneurs looking to build meaningful and successful businesses in any sector.

To learn more, check out the related THE ECOMMERCE EDGE Podcast episode below: